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The Situation

​We just start to realize how deep the correction last summer was on the ​​​US equity market: On the low made on August 24 2015 on the Dow Jones ​Transports ( DJT ) at ​7452.70, even if few realize that the DJT now trade ​well below that level. ​( See first chart below: Amber Trendline )​​​ Rebounding from those abyssmal technical levels was quite a statement ​from Mr Market in August 2015 but since then more and more divergence ​occuring ​between the Mighty Dow Jones Transportation Average Index (DJT) ​and the ​Dow Jones Industrial Average (DJI)​.​​​​In fact, different technical indicators or trendline make a huge divergence:

​Why so:
​1) SP500 Index is at only 9.1% from its peak reached on May 20 2015.​​​​( See first chart below )​

​2) SP500 Index is in fact far of testing the Monthly Major Support Trendline that started back on March 2009. ​​​​( See first chart below - Thick Blue Trendline )​ ​3) SP500 Index tested the Monthly Major Support Trendline that started back on October 2014 and rebounded. ​​​​( See first chart below - Thick Grey Trendline - Ellipse )​ ​​4​​) DJT is at 25.8% from its peak reached on November 28 2014.​​​​​( See second chart below )​ ​​​​​5) DJT is testing already the Monthly Major Support Trendline that started back on March 2009.​​​​( See second chart below - Thick Blue Trendline - Ellipse )​

​​​​6) DJT tested and broke already the Monthly Major Support Trendline that started back on October 2014.​​​​( See second chart below - Thick Grey Trendline - Ellipse )​ ​​ONE chart below is worth a look where we will show the ratio of the ​​Dow Jones Transportation ​to the Mighty SP500
​since It reached a level last seen in October 2012...
( Bottom Chart )

​​​​​But the most interesting technical factor is that it is the first time that we have that ratio (Dow Jones Transportation ​to the Mighty) broke the Monthly Major Support Trendline that started back in January 2008 ​( Bottom Chart - Blue Line - Ellipse )